China Watch: Breaking Down Barriers to Private Business

The Communist Party's latest plenary meeting offered some hope.

TAPEI, Taiwan ( TheStreet) -- Just days after an annual Communist Party meeting packed with the secrecy that usually keeps investors guessing about their odds of success in the $8.8 trillion economy, the leadership suddenly told us what's going on. Though what the leaders said was still vague and patchy, it should help foreign investors.

A blueprint released Nov. 15 to summarize the stuffy-sounding Party plenary session in Beijing says China will allow private banks for the first time as it continues liberalizing interest rates. The government will also let the free market decide prices on utilities, gas, oil and transport.

The central government will take over more spending decisions from financially shaky local entities. And the 35-year-old one child policy to control population growth will ease.

Taken together, that's all supposed to help private enterprise, which has long complained of regulatory and access barriers despite clear inroads.

"This document is clear, wide-ranging and does not shy away from areas of contention," London-based Capital Economics wrote in a Nov. 15 update on China, calling it a "blueprint" that "is the most impressive statement of reform intentions that we've seen this century."

The century is just 13 years old, not much in the annals of Chinese history. But that span has taken the economy to No. 2 in the world and made China an assumed place to do business for the world's top multinationals.

Multinationals are expected to gain from the blueprint. In banking, qualified new investors will be able to set up in China subject to stronger regulations, though it's not clear whether existing foreign banks such as Wells Fargo ( WFC) or HSBC ( HSBC) will be able to expand or add services.

Market determination of utility rates suggests that private and state companies, which have long had an advantage in the command economy, would someday pay the same amount instead of state-run insiders getting subsidized and the outsiders paying more.

More central control over local governments, long considered partial to their own homegrown contractors, could make bidding fairer for local projects.

Easing the one-child policy, a relic of the Deng Xiaoping years that has already been eroded by loopholes and violations, would put more consumers in China's malls, both real and virtual, a boon to fast-food chains and car makers -- General Motors ( GM) remains a favored foreign brand - and to electronics sellers from Apple ( AAPL) to ZTE.